According to some reports, the insurtech funding space is a difficult place to be. Venture capital funding in insurtechs has fallen to levels not seen since 2018, with US$2.4 billion in the first half of 2023, down 45% year on year, a report by key industry players has shown.
However, the latest data compiled by Gallagher Re, the environment might not be as bleak as it appears. As part of its Global InsurTech Report, the reinsurance giant found that funding for insurtech companies worldwide has experienced a significant surge of 37.6% in the first quarter of 2023.
The report highlights that global investments in the sector reached a substantial amount of $1.39 billion, indicating a notable rise compared to the previous quarter.
This surge comes after a period of decreased funding, with the previous quarter recording the lowest total since the first quarter of 2020. The report reflects the growing interest and confidence in the insurtech industry, as investors continue to recognise its potential for innovation and disruption within the insurance sector.
The substantial increase in funding during the first quarter of 2023 showcases the resilience and continued growth of InsurTech companies worldwide, setting a positive trajectory for the industry’s future.
Accelerant: Raised $150 million
This latest funding round comes on the heels of a successful fundraising effort last year when Accelerant secured approximately $190 million at a pre-money valuation of $2 billion.
Jeff Radke, the CEO and co-founder of Accelerant, highlighted the importance of the Risk Exchange in empowering Accelerant’s members to pursue diverse opportunities within their markets. He emphasized the platform’s focus on data transparency, robust analytics for underwriting, and long-term capacity solutions..
The Hagerty Group: Raised $105 million (Post-IPO Equity)
Hagerty Group, the car and boat specialty insurer, raised $105 million Specialty car insurance provider Hagerty has raised capital to support its growth plans and strategic objectives with the help of its main strategic investor, State Farm..
The funding round comprised $80 million of convertible preferred equity and a $25 million commitment of long-term debt financing. The capital will fuel the company’s profitable expansion initiatives, including the enhancement of offerings for current members and the acquisition of new members within the car enthusiast community. Additionally, the funds will enable Hagerty to invest in technology, driving operational efficiencies and improving customer interactions.
State Farm’s Chairman, President, and CEO, Michael Tipsord, expressed his satisfaction in a statement, stating, “We are pleased to continue to grow our investment in Hagerty and help support their strategic business objectives as we prepare for the upcoming launch of our commercial relationship.”
OneDegree: Raised $55 million
OneDegree Group, a prominent digital asset insurtech leader based in Hong Kong, has successfully raised $55 million in its Series B funding round. The company’s strong revenue growth across all business units, coupled with its groundbreaking advancements in digital asset insurance and AI-powered InsurTech solutions, attracted significant investments.
The news also follows on from OneDegree Global’s recent strategic partnership formation with Microsoft Hong Kong.
Alvin Kwock, co-founder and CEO of OneDegree Group, expressed his satisfaction with the company’s achievement of product-market fit and spoke about the team’s commitment to delivering customer-centric products.
Federato: Raised $25 million
The Riskops platform for P&C and specialty insurance provider, Federato, raised $25 million is its Series B round, which was led by Caffeinated Capital. Other investors were Emergence Capital and Pear VC.
Varun Gupta, partner at Caffeinated Capital and newly appointed board member, commented, “Federato’s software is so valuable that billion-dollar global insurance companies and startup MGAs alike buy, use, and evangelise it. After hearing rave reviews from those customers, seeing the company’s strong growth, and observing the team’s march towards building the industry cloud for P&C, we are excited to triple down.”
This latest funding will be directed towards continuing the company’s forward momentum, applying AI and Reinforcement Learning to the challenge of portfolio optimisation.
The funding round was spearheaded by Caffeinated Capital, with substantial participation from Emergence Capital and Pear VC. This fresh injection of capital comes hot on the heels of Federato’s Series A announcement, which took place less than a year ago.
Meanwhile: Raised $19 million
In its seed round, Life insurer accepting premiums and paying claims in cryptocurrency insurtech Meanwhile, raised $19 million in an funding event led by Sam Altman and Lachy Groom Other Participants: Gradient Ventures
Zac Townsend, the Co-Founder and CEO of Meanwhile, said of the capital raise: “As one of the few innovations in money in the last century, Bitcoin is on track to become a global store of value and functional currency. When you combine that with artificial intelligence, we see the potential to build a full-stack life insurance company with the aim to reach over a billion people globally. To start, it makes perfect sense for long-term holders of BTC to invest in life insurance denominated in that asset and to enable a percentage of their BTC holdings to become active.”
Ole Insurance Group: Raised $12 million
On June 1, 2023, during its Series A round, Ole Insurance Group a digital-first, full-stack insurance carrier, raised $12 million in capital, led by investors, AV8 Ventures and Alma Mundi Ventures and Morro Ventures.
Olé Life, a full-stack insurance carrier, aims to cater to the expanding middle class in Latin America by offering financial protection that was previously inaccessible. The company specializes in providing life insurance through convenient digital channels such as web platforms and mobile applications. Notably, Olé Life has developed an innovative digital underwriting process that eliminates the need for a traditional medical examination. This advanced methodology allows the company to efficiently assess and underwrite policies of up to $1 million.
Leading the company is Michael Carricarte, an experienced entrepreneur in the insurance industry who has successfully launched three previous startups. With Olé Life, Carricarte is focused on revolutionising the insurance landscape and making comprehensive life insurance accessible to a wider audience in Latin America.
Bdeo: Raised $8.2 million
Bdeo, the Madrid-based insurtech and, a rapidly growing technology company specialising in Visual Intelligence for the insurance and fleet industries, has successfully raised an additional $8.2 million in funding to fuel its international expansion and solidify its position in Europe and Latin America.
Julio Pernía Aznar, CEO of Bdeo (pictured), expressed his gratitude for the trust placed in the company: “We are reassured by the confidence shown by investors, given the impressive results we have achieved and our ability to operate efficiently during these challenging times.
João Miguel Dias, Principal at Armilar, highlighted the significance of Bdeo’s platform: “While insurers continue to explore process automation technologies to reduce loss ratios and enhance customer satisfaction, few solutions have the potential for widespread adoption,” he said
Raincoat: Raised $6.5 million
Raincoat, a startup developing scalable climate insurance solutions that enable instantly processed individual claims, today announced the closing of an additional $6.5 million seed round bringing its total raised to date to $11 million.
The funding round was led by TwoSigma Ventures – along with European based VC firm Mundi Ventures, Revolution’s Rise of the Rest Seed Fund and EleFund.
This round of capital will support the company’s expansion to new markets to provide FEMA-like services – much faster than existing emergency solutions – after particular disasters such as hurricanes and earthquakes in the Caribbean, Mexico, and the Gulf Coast, wildfires in the west, and threats such as flood, drought, and excessive rain in Colombia and Brazil.
Article by Joanna England
Joanna England is an award-winning journalist and the Editor-in-Chief for Insurtech Insights. She has worked for 25 years in both the consumer and business space, and also spent 15 years in the Middle East, on national newspapers as well as leading events and lifestyle publications. Prior to Insurtech Insights, Joanna was the Editor-in-Chief for Fintech Magazine and Insurtech Digital. She was also listed by MPVR as one of the Top 30 journalist in Fintech and Insurtech in 2023.